(Updates prices)
March 14 (Reuters) - London copper prices dropped nearly
1% on Tuesday, as a firmer dollar made the greenback-priced
metal expensive to holders of other currencies, while markets
continued to process the sudden collapse of two U.S. regional
banks.
Three-month copper on the London Metal Exchange shed
0.9% to $8,850 a tonne by 0827 GMT, while the most-traded April
copper contract on the Shanghai Futures Exchange fell
0.6% to 68,550 yuan ($9,974.83) a tonne.
The dollar edged higher, having dropped to a near
one-month low in the previous session as traders and investors
expect a slowdown in interest rate hikes following the collapse
of the banks.
Fears of a U.S. banking crisis were intensified by the
collapse of lenders Silicon Valley Bank (SVB) and
Signature Bank , even as President Joe Biden pledged to
take action to ensure the safety of the banking system.
Still, green shoots of improved copper demand in top
consumer China cushioned the drop in prices.
Yangshan copper premium rose to $25 a tonne on
Monday, its highest since March 1, indicating improving demand
for imported copper into China, albeit still far below some
$150-a-tonne premium hit last October.
The SHFE front-month copper contract has been
trading at a premium to the third-month contract since
Monday, switching from a discount seen for most of this year,
indicating tightening nearby Chinese supply.
Analysts anticipated Chinese copper demand to improve in
late March or from the second quarter, following the easing of
COVID-19 restrictions. Falling copper prices also supported
sentiment.
"Demand continues to recover," Jinrui Futures said in a
report. However, it said copper prices still faced risks of
correction as demand recovery was still lower than expected.
LME aluminium was down 1.3% at $2,304 a tonne, tin shed 2.6% to $22,615 a tonne, zinc edged up 0.1%
to $2,950 a tonne, and lead fell 0.5% to $2,071 a tonne.
SHFE aluminium rose 0.1% to 18,270 yuan a tonne,
nickel dipped 0.1% to 177,570 yuan a tonne, zinc was up 0.1% at 22,855 yuan a tonne, lead rose
0.6% to 15,240 yuan a tonne, and tin fell 1.9% to
184,000 yuan a tonne.
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(Reporting by Mai Nguyen in Hanoi; Editing by Sherry
Jacob-Phillips and Rashmi Aich)
mai.nguyen.thomsonreuters.com@reuters.net))
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